This is direct tax guidance; for indirect tax guidance, refer to VAT Guidance.

Refunds of sums originally paid as VAT are not ‘windfall’ amounts; they are non-gratuitous sums paid by HMRC as a result of a claim. The right to a refund typically arises following a change of view as to the legal obligation to pay a sum in the past. Whether the change of view arises from a Court decision (UK or European) or for some other reason does not alter the treatment of the refund for direct tax purposes.

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